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County audit could be handled by state

By COLLIN BROOKS

Staff Writer

[email protected]

There are plenty of things that can potentially affect Washington County when Governor Bill Haslam’s 2016-2017 fiscal budget for the state is approved and becomes effective on July 1. But one line item specifically mentions Washington County and could change the way audits have been handled in the state’s oldest county for almost five decades.

For 50 years, Blackburn, Childers & Steagall has handled the audits for Washington County, but in Haslam’s budget he allots $198,000 to “provide recurring funds for two full-time legislative auditor for positions to perform local government audits for Washington and McMinn County.”

The Washington County Commission opposed this portion of the budget with a 21-0 vote in favor of Resolution 16-02-7. However, Washington County Mayor Dan Eldridge said the resolution still hasn’t gained any traction in Nashville, with voting on the budget to come in the following weeks.

“I have not had any feedback since the resolution was provided to the folks in Nashville,” Eldridge said. “It’s something that we are struggling to understand how it creates any value for Washington County.”

Part of the misunderstanding comes in the fact that Tennessee Code Annotated 4-3-304 states that allows independent audits by certified and public accountants as long as they are paid for the the county and meet minimum standards set by the comptroller and approved by the governor.

Eldridge also says that it appears that the change isn’t coming to two counties that aren’t in financial trouble.

“McMinn and Washington counties are two of the most financially sound counties in the entire state,” he said. “McMinn county is the only county in Tennessee that doesn’t have any debt.”

Currently, besides McMinn and Washington County, four other counties perform independent audits from the state in Shelby, Davidson, Knox and Hamilton counties and that won’t change.

That means that the Comptroller’s office handles 89 of the 95 audits for the counties of Tennessee and Tennessee Comptroller’s Office Chief of Staff Jason Mumpower said that the office taking over these two audits is another step in having the Comptroller’s Office handle all of the audits that they possibly can.

“As we have been working to fulfill our statutory obligation to perform these audits, in consultation with the administration, funding has been put into the budget this year that will allow the Comptroller’s office to continue to meet its mission of auditing county government,” he said.

Mumpower said that he had seen the resolution and respected it fully, but brought up that it might be good to have a new, independent eye on the audit procedure.

“It raises a very keen point that rotation of auditors is a good thing.,” he said. “Sometimes you don’t want to be too familiar with your auditor and you don’t auditor to be too familiar with you. Loving your auditor is like loving your dentist, I don’t know anyone that is just dying to go in for a root canal.”

Another benefit to the new auditing is that it will save Washington County “tens-of-thousands of dollars”, according to Mumpower.

“A great benefit to both Washington and McMinn (counties) should be a saving of thousands of dollars in taxpayers money, in that we perform this audit in a fraction of the cost,” Mumpower said.

However, the monetary savings might not outshine the knowledge that will be lost.

“From my perspective, the real value in that, is that you have Blackman, Stegall and Childress with literally 50 years of experience auditing Washington County. That 50 years transcends every office holder and there is a tremendous amount of value in that,” Eldridge said.

That allows BCS to look at the financials under different administrations and make sure that there isn’t anything off kilter.

“It’s an opportunity for them to observe and identify matters that need to be further investigated,” Eldridge said.

The almost $100,000 for the audit through the comptroller’s office would be cheaper for the county, but Eldridge said that it could also be more expensive in the long run.

“We rely on BCS for more than just the audit and now we would have to pay separate for those services,” Eldridge said. “So you add consulting fees to BCS, that the comptroller’s office provide, to what the comptroller will provide; and i don’t think that we will be saving any money.”

Some of those services include IRS filings, grievance certifications and special engagements, which help the county stay on track for their fiscal year.

“Washington County will be able to continue to use that accounting firm or any accounting firm to help with their management responsibilities if they choose to do that. So I don’t think they have to loose any depth of knowledge about their management operations.

The timing is another concern that is raised in the resolution and by Eldridge, as the county is about to undertake a computer system conversion.

“Because we won’t actually be in there until July 1, 2017, that should give them plenty of time to transition to their new system,” Mumpower said. “So that should be able to take that worry right off the table.”